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How do demand response and electrical energy storage affect (the need for) a capacity market?

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  • Khan, Agha Salman M.
  • Verzijlbergh, Remco A.
  • Sakinci, Ozgur Can
  • De Vries, Laurens J.

Abstract

To ensure security of supply and incentivize reliable investment in generation capacity, capacity markets (CMs) have been implemented or are being considered. However, demand response (DR) and electrical energy storage (EES) also contribute to system adequacy. In this paper, we analyse the change in the need for a CM if DR and EES are available, in the presence of a growing portfolio share of intermittent renewable energy sources electricity (RES-E). We present a novel hybrid electricity market model of the transition to a low-carbon electricity system which uses optimization for short-term market operations and agent-based simulation of long-term decisions.

Suggested Citation

  • Khan, Agha Salman M. & Verzijlbergh, Remco A. & Sakinci, Ozgur Can & De Vries, Laurens J., 2018. "How do demand response and electrical energy storage affect (the need for) a capacity market?," Applied Energy, Elsevier, vol. 214(C), pages 39-62.
    • Handle: RePEc:eee:appene:v:214:y:2018:i:c:p:39-62
    DOI: 10.1016/j.apenergy.2018.01.057
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    7. Bhagwat, Pradyumna C. & Richstein, Jörn C. & Chappin, Emile J.L. & de Vries, Laurens J., 2016. "The effectiveness of a strategic reserve in the presence of a high portfolio share of renewable energy sources," Utilities Policy, Elsevier, vol. 39(C), pages 13-28.
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